95-5 rule and the battle between demand generation vs. lead generation in B2B marketing
ARTICLE
As a B2B marketer, you know that generating leads and driving sales is essential to the success of your business. But with so many different available marketing strategies and tactics, it can be challenging to know where to focus your efforts.
One area often discussed in the context of B2B marketing is the difference between demand generation and lead generation. While these two strategies are related, they serve different purposes and can be used in different ways to help businesses reach their marketing and sales goals.
Demand generation
Demand generation is all about creating awareness and interest in your company’s products or services among your target audience. This is typically done through a variety of marketing activities, such as paid social media. The goal of demand generation is to increase the overall demand for your company’s products or services, which can help to drive more traffic to your website and generate more leads and paying customers at the end of the day.
Lead generation
Lead generation, on the other hand, is focused on capturing the contact information of potential customers interested in your company’s products or services. This is typically done through forms on your website, where visitors can enter their contact information in exchange for valuable content, such as ebooks, webinars, or other resources. Lead generation aims to build a database of qualified leads that your sales team can contact and nurture into paying customers.
95-5 rule
But how effective are these strategies, and which one should you focus on? The answer, of course, depends on your specific business goals and the needs of your target audience. However, there is one rule of thumb that is often discussed in the context of B2B marketing: the 95-5 rule. The 95-5 rule suggests that in typical cases, only 5% of your audience is in buying window at a certain point in time. Or in other words, 95% of businesses are not in the market.
The 95-5 rule helps you understand the challenges and opportunities you may face when generating leads and driving sales. It can also help you set realistic expectations and allocate your resources appropriately to maximize the return on your marketing investments – and most importantly, how fast you should expect these hard results. Essentially, we are speaking about long-term brand building vs. short-term marketing gains: your brand should be familiar to the buyers when they enter the markets.
What does this mean for your demand generation and lead generation efforts? In short, it means that both strategies are important, and they should be used together to create a comprehensive and effective approach to reaching your target audience – and eventually maximize the probability of getting the clients in when the time is right.
This piece of content touching the hot topic in B2B marketing, especially in the LinkedIn ads space, was our first experimentation using the ChatGPT to assist in our content production.
You can find more information about the 95-5 rule in the recent study by Prof. John Daves / B2B institute.
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